I am seeing some major negativity in the stocks, but still no drop in the damn fertilizer names :) I assume these will only fall when we get the "crazy throw everything to the curb I don't want to be long anything" sort of selling we got in August and November. But I've decided to chop another layer of my Ultrashorts off. The S&P 500 quickly approaches the August/November lows of 1400-1405, just like that (a week ago we were at 1495? amazing). While it is possible we just continue straight down, the more probable path is some bounce in first half of next week. In a general sense nothing goes straight down, or up. If we get that bounce, I will use that opportunity to reload on my insurance (Ultrashorts). They are helping to mitigate losses to some degree today. If I am wrong and we just continue to go straight down - well I will be giving back some of these large gains in the fund performance but that's why you need to make hay when you can. :)
I also don't want to be in the path of a surprise intervention which the Bernanke Fed seems to love to do at the most inopportune times for shorts. But I do think we have first sniffs of fear in the air - first since November. Reality is finally starting to hit some people over the head - those that have denied reality since that fateful day in July when Bear Stearns hedge funds started to implode. Not a great start to the year for the bulls.
One area that seems to be doing quite well today are the Chinese large cap and mid cap ADRs... so that got my attention. I added to my New Oriental Education (EDU) this morning and just added some to my Ctrip.com (CTRP) here on this relative strength. The Chinese large caps have stunk the past few months, but could be putting in some near term bottom here so I have really lightened up on my Ultrashort Xinghau China 25 (FXP)
Long all names mentioned above in fund; no personal positions
